BMW's Project Switch (B): Importers vs. National Sales Companies SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of BMW's Project Switch (B): Importers vs. National Sales Companies
BMW is faced with potential channel conflicts across several EU country markets. The case concludes the (A) case's exploration of BMW's approach to redesigning the channel in Greece. The case provides details on both headquarter and country head perspective on BMW's channel strategy.
Authors :: Das Narayandas, Kerry Herman, Laura Winig
Swot Analysis of "BMW's Project Switch (B): Importers vs. National Sales Companies" written by Das Narayandas, Kerry Herman, Laura Winig includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bmw's Channel facing as an external strategic factors. Some of the topics covered in BMW's Project Switch (B): Importers vs. National Sales Companies case study are - Strategic Management Strategies, International business, Marketing, Sales, Strategy and Global Business.
Some of the macro environment factors that can be used to understand the BMW's Project Switch (B): Importers vs. National Sales Companies casestudy better are - – cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, increasing commodity prices, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings,
increasing energy prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of BMW's Project Switch (B): Importers vs. National Sales Companies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in BMW's Project Switch (B): Importers vs. National Sales Companies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bmw's Channel, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bmw's Channel operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of BMW's Project Switch (B): Importers vs. National Sales Companies can be done for the following purposes –
1. Strategic planning using facts provided in BMW's Project Switch (B): Importers vs. National Sales Companies case study
2. Improving business portfolio management of Bmw's Channel
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bmw's Channel
Strengths BMW's Project Switch (B): Importers vs. National Sales Companies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bmw's Channel in BMW's Project Switch (B): Importers vs. National Sales Companies Harvard Business Review case study are -
Highly skilled collaborators
– Bmw's Channel has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in BMW's Project Switch (B): Importers vs. National Sales Companies HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Bmw's Channel is one of the most innovative firm in sector. Manager in BMW's Project Switch (B): Importers vs. National Sales Companies Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Bmw's Channel is present in almost all the verticals within the industry. This has provided firm in BMW's Project Switch (B): Importers vs. National Sales Companies case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy in the BMW's Project Switch (B): Importers vs. National Sales Companies Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Bmw's Channel is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Bmw's Channel is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in BMW's Project Switch (B): Importers vs. National Sales Companies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Global Business field
– Bmw's Channel is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Bmw's Channel in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Bmw's Channel has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in BMW's Project Switch (B): Importers vs. National Sales Companies Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Bmw's Channel has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Cross disciplinary teams
– Horizontal connected teams at the Bmw's Channel are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Ability to recruit top talent
– Bmw's Channel is one of the leading recruiters in the industry. Managers in the BMW's Project Switch (B): Importers vs. National Sales Companies are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Bmw's Channel has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bmw's Channel has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Effective Research and Development (R&D)
– Bmw's Channel has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study BMW's Project Switch (B): Importers vs. National Sales Companies - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses BMW's Project Switch (B): Importers vs. National Sales Companies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of BMW's Project Switch (B): Importers vs. National Sales Companies are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the BMW's Project Switch (B): Importers vs. National Sales Companies HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Bmw's Channel has relatively successful track record of launching new products.
Products dominated business model
– Even though Bmw's Channel has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - BMW's Project Switch (B): Importers vs. National Sales Companies should strive to include more intangible value offerings along with its core products and services.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Bmw's Channel supply chain. Even after few cautionary changes mentioned in the HBR case study - BMW's Project Switch (B): Importers vs. National Sales Companies, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bmw's Channel vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Bmw's Channel is dominated by functional specialists. It is not different from other players in the Global Business segment. Bmw's Channel needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bmw's Channel to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study BMW's Project Switch (B): Importers vs. National Sales Companies has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Bmw's Channel 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bmw's Channel is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study BMW's Project Switch (B): Importers vs. National Sales Companies can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As BMW's Project Switch (B): Importers vs. National Sales Companies HBR case study mentions - Bmw's Channel takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study BMW's Project Switch (B): Importers vs. National Sales Companies, in the dynamic environment Bmw's Channel has struggled to respond to the nimble upstart competition. Bmw's Channel has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Bmw's Channel has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow decision making process
– As mentioned earlier in the report, Bmw's Channel has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Bmw's Channel even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High cash cycle compare to competitors
Bmw's Channel has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities BMW's Project Switch (B): Importers vs. National Sales Companies | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study BMW's Project Switch (B): Importers vs. National Sales Companies are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bmw's Channel is facing challenges because of the dominance of functional experts in the organization. BMW's Project Switch (B): Importers vs. National Sales Companies case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Bmw's Channel can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Loyalty marketing
– Bmw's Channel has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Creating value in data economy
– The success of analytics program of Bmw's Channel has opened avenues for new revenue streams for the organization in the industry. This can help Bmw's Channel to build a more holistic ecosystem as suggested in the BMW's Project Switch (B): Importers vs. National Sales Companies case study. Bmw's Channel can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bmw's Channel can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Bmw's Channel to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Better consumer reach
– The expansion of the 5G network will help Bmw's Channel to increase its market reach. Bmw's Channel will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Bmw's Channel in the consumer business. Now Bmw's Channel can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Bmw's Channel can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. BMW's Project Switch (B): Importers vs. National Sales Companies suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Using analytics as competitive advantage
– Bmw's Channel has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study BMW's Project Switch (B): Importers vs. National Sales Companies - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bmw's Channel to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Bmw's Channel to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bmw's Channel can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, BMW's Project Switch (B): Importers vs. National Sales Companies, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Bmw's Channel can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Threats BMW's Project Switch (B): Importers vs. National Sales Companies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study BMW's Project Switch (B): Importers vs. National Sales Companies are -
Regulatory challenges
– Bmw's Channel needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Bmw's Channel business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bmw's Channel in the Global Business sector and impact the bottomline of the organization.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Bmw's Channel will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Bmw's Channel is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Bmw's Channel high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Environmental challenges
– Bmw's Channel needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Bmw's Channel can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bmw's Channel can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study BMW's Project Switch (B): Importers vs. National Sales Companies .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study BMW's Project Switch (B): Importers vs. National Sales Companies, Bmw's Channel may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Increasing wage structure of Bmw's Channel
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Bmw's Channel.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bmw's Channel with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Bmw's Channel can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of BMW's Project Switch (B): Importers vs. National Sales Companies Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study BMW's Project Switch (B): Importers vs. National Sales Companies needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study BMW's Project Switch (B): Importers vs. National Sales Companies is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study BMW's Project Switch (B): Importers vs. National Sales Companies is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of BMW's Project Switch (B): Importers vs. National Sales Companies is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Bmw's Channel needs to make to build a sustainable competitive advantage.
